Punch considers £5b bid for Mitchells & Butlers – For more hospitality stories, see what the weekend papers say

26 November 2007 by
Punch considers £5b bid for Mitchells & Butlers – For more hospitality stories, see what the weekend papers say

Punch considers £5b bid for Mitchells & Butlers
Punch Taverns, the UK's biggest pub company, is believed to be considering a £5b-plus bid for managed pub operator Mitchells & Butlers The Times](http://www.timesonline.co.uk/tol/news/), 24 November

Punch sounds out investors over M&B takeover Punch Taverns will come under pressure on Monday to clarify its intentions regarding its potential £5b bid for M&B. Acting for Punch, Morgan Stanley has already sounded out key shareholders involved with both companies, including London hedge fund Marshall Wace and American investment house Alliance Bernstein. The proposal could value M&B at about 800p a share and would create a giant pub company with more than 11,000 venues. Some investors, however, want to pursue the strategy favoured by Robert Tchenguiz (who has a 20% stake in M&B) to put the property assets into a £4.5 billion tax-efficient real-estate investment trust, funded by Citi. On Friday, shares in Punch rose 14p to 854p while M&B's shares rose 41p to 641p. - [The Sunday Times](http://www.timesonline.co.uk/tol/news/), 25 November

Compass to reveal contract coup and profit surge
Compass has won a deal to supply the US House of Representatives, which investigated its role in a scandal over supplying United Nations peacekeepers two years ago. In 2005, Compass sacked three senior employees involved in supplying catering services to the UN and later admitted the implication of five more staff. It paid out £39m to settle a civil case without admitting liability. The catering giant, which has undergone a major reshaping under new chief executive Richard Cousins, is expected to announce the contract this week alongside an anticipated sharp rise in full-year profits to around £430m, up from £311m the year before (excluding the sale of Selecta). Under the previous management, Compass's share price collapsed from a 385p high in early 2004 to 175p in late 2005. This weekend, the share price stood at 298p, valuing the group at £5.65 billion.- [The Sunday Times](http://www.timesonline.co.uk/tol/news/), 25 November

Wagamama delays flotationWagamama, the noodle bar operator controlled by Lion Capital, is thought to have put its plans for a sale on ice after private equity firms balked at the mooted £215m price price. - [The Times](http://www.timesonline.co.uk/tol/news/), 24 November

GM cultivation could be banned in Europe EU Environment Commissioner Stavros Dimas is considering withholding approval for the cultivation of two types of genetically-modified maize because they pose "unacceptable" risks to the environment. The move could spell the end of GM cultivation in Europe as the two maize strains - modified to produce an insecticide to kill the European corn borer - is similar to the only GM food currently grown in the EU. Although the European Food Safety Authority, seen as too pro-GM by critics, has twice cleared the insecticide-producing plants, Dimas said new research found the insecticide harmed butterflies, poisoned streams and varied enormously in the volume. His recommendation, if upheld, would herald a major shift in approach to GM foods from the EU, which has previously approved all bids to market GM seeds for cultivation. - Independent On Sunday, 25 November

Peta plans Xmas foie gras protests
Animal welfare charity Peta will launch an ad campaign and protests outside stores stocking pate de foie gras in the run up to Christmas. Campaigners see the delicacy as a cruel product that involves force-feeding ducks and geese up to 4lb of grain and fat two or three times a day via pipes until their livers become diseased and enlarged. Peta supporters plan to hold a series of protests outside Selfridges - which has refused to follow Harvey Nichols' decision to stop selling foie gras - along with Harrods and Fortnum & Mason. Selfridges, however, says it will introduce what it describes as "welfare-friendly" foie gras next month sourced from geese that are not force-fed but are given unlimited amounts of food to graze on. Force-feeding is banned in 15 countries, including Britain, and the sale of foie gras will become illegal in California from 2012. - The Independent on Sunday, 25 November

S&N fights back against hostile bid British brewer and pub operator Scottish & Newcastle (S&N) has attacked Heineken and Carlsberg for "misusing" confidential details of its Russian joint venture with Carlsberg in their hostile takeover bid for S&N. S&N chief executive John Dunsmore accused Heineken of "indirectly misusing" the data and said Carlsberg had breached the terms of the joint venture by misusing the details for its offer and suppressing information that could help its shareholders assess its value. S&N has launched a formal claim to take control of the joint venture, Baltic Beverage Holdings, under Swedish arbitration and may bring in a minority financial partner to help fund the deal. Under the increased 750p-a-share offer, Carlsberg planned to take outright control of the joint venture, by taking over S&N's 50% stake. - [The Times](http://www.timesonline.co.uk/tol/news/), 24 November

By Angela Frewin

E-mail your comments to [Angela Frewin](mailto:Angela.Frewin@rbi.co.uk?subject=Punch considers £5b bid for Mitchells & Butlers â€) here.

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